Tech Talk: How AI is Changing IT Services Business Models and M&A
Insights from Baird’s Private Company Technology & Services Conference
AI and data are taking center stage in many industries, creating both new opportunities and new considerations for IT Services players of all sizes. While their full potential and impact will take years to quantify, data and AI have already become critical considerations for business leaders and are beginning to reshape industries in real time. We convened a panel of industry leaders to discuss this fascinating intersection of data, AI and business at our 2025 Private Company Technology & Services Conference.
Moderated by Alex Sevilla, Managing Director in Baird’s Global Technology & Services Investment Banking group, the panel included Prasad Chintamaneni, interim CEO of Emids and Managing Director at New Mountain Capital; Owen Frivold, CEO of Cleartelligence; Greg Layok, CEO of Resultant; Jonathan Rothenberg, Chief Corporate Development Officer at Tredence; Sanjay Singh, CEO of Onix; and Krista Young, Managing Director of Corporate Development at Accenture.
The group delved into themes they’re seeing around the proliferation of data and implementation of AI in their work. Following are highlights from the discussion.
Data Readiness is Critical
The relationship between data readiness and success in AI implementation quickly emerged as a key theme among panelists. Data that is accurate, clean, accessible and well-organized is foundational for AI success. However, “data readiness” also depends heavily on an organization’s intended AI use case. Businesses must thoughtfully consider their data and AI goals and design tailored strategies and systems to accomplish to ensure AI models are useful. The “garbage in, garbage out” mantra holds true when it comes to AI outcomes; training models on accurate data, as well as the context surrounding data, is key.
Panelists also emphasize the importance of investing in a modern data stack and robust data infrastructure to ensure organizations can fully leverage AI.
Human-Enabled AI Will Be Key in Highly Regulated End Markets
AI has great potential in complex, regulated sectors, but a human touch will be indispensable in successfully implementing AI in those areas. Panelists discussed AI’s potentially transformative impact in healthcare. In addition to applications in administrative efficiency, drug discovery, preventative care and membership engagement, AI will require human oversight for other future use cases such as prescribing drugs or making coverage decisions. Humans must remain in the loop to ensure decisions are correct and ethical.
Similar dynamics are at work in the state and local government sector, where data and AI are being leveraged to gain administrative and communication efficiencies. Government entities are also applying data and AI to guide decisions related to public services and public health. In these situations, AI should not be making the decision on its own. Human-enabled AI will be key.
AI is Changing the Game for M&A Investors and Targets
Unsurprisingly, AI’s influence also extends to M&A activity and decision-making. However, investors don’t expect potential targets to have all the data and AI answers at this time. Buyers are focused on how targets are incorporating data and AI into their go-to-market capabilities and internally with respect to their technical delivery and operational efficiencies. Business fundamentals, as well as the maturity of a data strategy, and an advanced analysis of a company’s AI capabilities are key. Companies that can articulate a vision for how data and AI could enable new operating models, train or otherwise transform their workforce, will also stand out to potential investors.
Baird’s IT Services Investment Banking Team
We welcome the opportunity to discuss these themes and how Baird’s IT Services team can assist your business growth and strategic objectives.
